EXHIBIT 10.3
EMPLOYMENT AGREEMENT
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BETWEEN
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XXXXXX X. XXXXXXXXX, XX.
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AND
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XXXXXXX & XXXXX, INCORPORATED
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SECTION PAGE
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Recitals
1. Employment
2. Term
2.1 Initial Term
2.2 Extension of Term
2.3 Early Termination
3. Duties and Authority
4. Compensation
4.1 Base Salary
4.2 Annual Cash Bonus
4.3 Vacations; Other Benefits
5. Expenses
6. Disability
6.1 Definition of "Totally Disabled"
6.2 Coordination of Disability Payments
and Base Salary
7. Executive's Option to Terminate Agreement
8. Consulting Agreement
9. Termination of Employment
9.1 Termination by the Company for Cause
9.2 Termination by the Company Without Cause
9.3 Termination by Executive
10. Confidential Information
11. Nonassignability
12. Miscellaneous
12.1 Waivers
12.2 Notices
12.3 Survival of Provisions
12.4 Severance Benefit Agreement
EXHIBIT 10.3
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (the "Agreement") is made as of November 7, 1990
(the "Effective Date") by Xxxxxxx & Xxxxx, Incorporated, a Missouri corporation
(the "Company"), and Xxxxxx X. Xxxxxxxxx, Xx., residing in Joplin, Missouri (the
"Executive").
RECITALS
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A. The Executive has been employed by the Company since 1977. Over this
period the Executive's services have contributed materially to the successful
operation of the Company's business.
B. The Company desires that the Executive remain in the employment of the
Company and accordingly the Compensation Committee of the Board of Directors of
the Company has recommended the execution of this Agreement and the full Board
has authorized the execution of the same.
AGREEMENT
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NOW, THEREFORE, for good and valuable considerations, the Company and the
Executive do agree as follows:
1. Employment
The Company hereby employs the Executive as Senior Vice President, General
Counsel and Secretary as well as Director of Mergers and Acquisitions and
Strategic Planning and the Executive hereby accepts employment in these
capacities. However, the Board may from time to time during the term hereof
elect to have the Executive serve in additional executive capacities at the
Senior Vice Presidential level or above and upon any such election the Executive
shall so serve.
The Executive's employment under this Agreement is subject to the terms and
conditions set out below and will be carried out at the Company's principal
executive offices wherever the same may be situated from time to time. However,
the Executive acknowledges that the nature of his employment may require
substantial domestic and international travel from time to time.
2. Term
2.1 Initial Term
The initial term of this Agreement shall begin on the Effective Date and
shall end on November 6, 1995.
2.2 Extension of Term
Following the initial term, this Agreement shall continue until it is
terminated by either party upon at least five years prior notice to the other
(which notice may be given at any time during the initial term or thereafter) or
until December 31, 2006, whichever occurs first.
2.3 Early Termination
The term of this Agreement as provided for in Section 2.1 and 2.2 may be
shortened only by reason of (i) the Executive's Total Disability, (ii) the
Executive's death, (iii) the mutual agreement of the parties or (iv) the other
reasons provided below (e.g. Sections 7 and 9).
3. Duties and Authority
The Executive shall devote his full business time to the affairs of
the Company. However, this shall not be deemed to prevent the Executive from
devoting such time (which shall not be substantial in the aggregate) to personal
business interests that do not unreasonably interfere with the performance of
the Executive's duties hereunder.
The Executive shall use his best efforts, skills and abilities to
promote the Company's interests; shall serve as a director if so elected by the
stockholders of the Company; and shall perform such duties at the Senior Vice
Presidential level or above as are provided for in Section 1 (first sentence)
and as may be hereafter assigned to him by the Board or the Chief Executive
Officer. The direction and control exercised by the Board and the Chief
Executive Officer shall be such as is customarily exercised by the Board and the
Chief Executive Officer over an executive at the Senior Vice Presidential level
or above. The Executive shall report to the Chief Executive Officer of the
Company.
4. Compensation
4.1 Base Salary
On the Effective Date the Executive is being paid a base salary
at an annual rate of $175,000. This base salary rate shall continue to on or
about April 1, 1991.
On or before April 1, 1991 and on or before April 1 of each
succeeding year during the term of this Agreement, the Compensation Committee of
the Board shall appraise the Executive's performance during the previous
calendar year, taking into account such factors as it deems appropriate. As a
result of such appraisal, the then annual base salary of the Executive shall be
increased (but may not be decreased) by such amount as the Compensation
Committee determines is fair, just and equitable; provided, however, the
percentage increase in the Executive's base salary shall always be at least
equal to the then latest percentage increase over the previous year in the
aggregate annual base salaries of the Company's five highest paid officers other
than the Executive and the Chief Executive Officer of the Company. In computing
this percentage increase the Compensation Committee shall ignore that part of
any base salary increase attributable in the Committee's reasonable judgment to
additional responsibilities assumed or to be assumed by any of such five highest
paid officers. Also in computing the percentage increase the Compensation
Committee shall make equitable adjustments in its computations so that the
Executive will not be prejudiced by any reduction in the responsibilities of any
of such five highest paid officers implemented during the immediately preceding
year or to be implemented in the immediately following year.
All salary increases under this section will be made as of the
beginning of the first payroll period immediately following the appraisal in
question.
The Executive's base salary shall be paid in equal installments,
at monthly or more frequent intervals.
4.2 Annual Cash Bonus
For the year 1990, the Executive shall be entitled to earn a cash
bonus of up to 40% of the Executive's annualized base salary as of December 31,
1990. The exact amount of this bonus shall be computed under the 1990 incentive
compensation guidelines issued pursuant to the Xxxxxxx & Xxxxx, Incorporated Key
Management Incentive Compensation Plan (the "Incentive Compensation Plan") and
approved by the Compensation Committee on February 14, 1990.
For the year 1991, and each succeeding year during the term of
this Agreement, the Executive shall be entitled to earn a cash bonus computed in
accordance with such Incentive Compensation Plan guidelines as are approved by
the Compensation Committee for that year. The Compensation Committee shall be
entitled to amend or supplement the guidelines from time to time whenever the
Committee deems this to be in the best interests of the stockholders of the
Company.
However, no amendment or supplement shall result in adversely affecting the
relative bonus position the Executive holds for the year 1990 vis-a-vis the
bonuses that may be earned for 1990 by the five highest paid officers of the
Company other than the Executive and the Chief Executive Officer of the Company.
In determining if any prohibited adverse effect may occur the parties shall
ignore any increase in bonuses for 1991 or later years attributable in the
Compensation Committee's reasonable judgment to additional responsibilities
assumed or to be assumed by any of the officers of the Company.
If the Executive's employment under this Agreement is properly
terminated as of a date before December 31, then the Executive shall be paid a
prorated bonus for the year of termination. This prorated bonus shall bear the
same ratio to the actual bonus the Executive would have earned with respect to
the full year under the Incentive Compensation Plan as the number of days this
Agreement is enforce during such year bears to 365. Any prorated bonus shall be
paid when the other annual bonuses are paid to Company officers. The preceding
provisions of this paragraph shall not be applicable if the Executive's
employment is terminated under any of the circumstances described in Sections
9.1, 9.2 or 9.3 below. In these latter circumstances all or a portion of the
annual bonus will be payable only if and to the extent provided for in or
contemplated by Sections 9.1, 9.2 or 9.3, as the case may be.
4.3 Vacations; Other Benefits
The Executive shall be entitled to four weeks vacation in each
calendar year with full pay and allowances.
In addition to the salary, bonus and any other payments to be
made under this Agreement, the Executive shall be entitled to participate in any
insurance, pension, profit sharing, stock bonus, stock option, stock purchase or
other benefit plan of the Company now existing or hereafter adopted for the
benefit of officers of the Company or the employees of the Company generally.
The Company shall provide office space, secretarial assistance,
supplies and equipment fully adequate to enable the Executive to perform the
services contemplated by this Agreement.
The Company shall provide the Executive with appropriate
perquisites at least comparable to those provided to the Executive on the
Effective Date hereof and, in all events, equal to such perquisites as may be
made available from time to time to the Company's other officers.
5. Expenses
The Company shall pay or reimburse the Executive for all reasonable
transportation, hotel, living and related expenses incurred by the Executive on
business trips away from the Company's principal office and for all other
business and entertainment expenses reasonably incurred by him in connection
with the business of the Company and its subsidiaries.
6. Disability
6.1 Definition of "Totally Disabled"
The Executive shall be deemed "Totally Disabled" if he is unable,
for a continuous period of six or more months, to perform substantially all of
the material personal services to be rendered by him under this Agreement.
During the continuance of any Total Disability of the Executive, the Board may
elect to terminate this Agreement by Board resolution delivered to the
Executive. Thereupon this Agreement shall terminate 60 days following delivery
of the Board resolution, it being understood that the Executive's cash
compensation and other benefits shall continue in full force until the date of
termination.
6.2 Coordination of Disability Payments and Base Salary
From time to time during the term of this Agreement the Executive
may receive "Disability Payments" as defined in this Section even though the
Executive is not "Totally Disabled" as that term is defined in Section 6.1 of
this Agreement. In such instances the Executive's base salary shall be reduced
dollar for dollar by the Disability Payments received by the Executive. As used
herein "Disability Payments" are payments made to the Executive:
(a) which are attributable to premiums paid by the Company under
any Company sponsored group disability plan;
(b) under any disability income policy owned by the Executive
provided the Company has reimbursed the Executive for the
premium on such policy either through a special bonus or
otherwise; and
(c) under Social Security or any other governmental disability
income program.
7. Executive's Option to Terminate Agreement
Not later than six months after the occurrence of any of the following
events the Executive may elect to terminate this Agreement by sending notice of
termination to the Company:
(a) The Executive shall not be elected and continue as director of
the Company (it being understood that Section 7(a) shall become
applicable only if and after the Executive is first elected a
Director of the Company and that nothing in this Agreement
requires the Board of Directors to nominate the Executive for
election as a Director of the Company);
(b) A public tender offer is made for the shares of the Company which
is opposed by the Board and the offeror acquires at least 40% of
the outstanding common shares of the Company or a proxy contest
is waged which is opposed by the Board and the person waging the
contest acquires a working control of the Company;
(c) Following a change in control whether by a tender offer or proxy
contest as described in Subsection (b) above or otherwise the
Company is merged or consolidated with another corporation;
(d) Following (i) a "Change in Control" as defined in Section 1 of
the Severance Benefit Agreement or (ii) a Change in Ownership or
Control as defined in Section 9.2 of this Agreement, the Company
is dissolved; or
(e) Following (i) Change in Control as defined in Section 1 of the
Severance Benefit Agreement or (ii) a Change in Ownership or
Control as defined in Section 9.2 of this Agreement,
substantially all of the assets of the Company are sold to any
other person.
The Executive's employment obligations under this Agreement shall
terminate on the date of termination specified in the Executive's notice to the
Company, which date (except as provided in the next sentence) must be within
sixty days of the date of the notice. The date of termination under any notice
delivered pursuant to Section 7(a) must be at least three months from the date
of the notice.
As used in this Section 7 and elsewhere in this Agreement, the term
"Severance Benefit Agreement" means the Severance Benefit Agreement dated May 9,
1984 between the Company and the Executive as such Agreement may hereafter be
amended, restated or superseded.
8. Consulting Agreement
Upon any termination of the Executive's employment under Section 7(b)
the Executive may elect within 120 days after termination of employment to
arrange to render consulting services to the Company on the terms and conditions
set out in this Section. The Executive shall be entitled to make the election
provided for in the immediately preceding sentence only if the Executive
concurrently forfeits his right to receive benefits under Sections 3 and 5 of
the Severance Benefit Agreement.
Beginning on the first day of the first month immediately following
the election under this Section and continuing for two years thereafter, the
Executive shall render such consulting services to the Company as the latter may
reasonably request from time to time. Consulting services shall be limited to
the Executive's consideration, review and/or rendering of advice regarding plans
or ideas or specific limited questions or problems proposed by the Company and
consultation on any major matters of policy affecting the Company, it being
understood that none of the foregoing is to generate substantial research,
travelling or deliberation time by the Executive.
In consideration for the consulting services rendered by the
Executive, the Company shall pay the Executive during the first and second years
of consultation an amount equal to 100% and 75%, respectively, of the total cash
compensation (including base salary and bonuses) earned by the Executive from
the Company with respect to the year immediately preceding the Executive's
termination of employment. The amount required to be paid each year shall be
paid in twelve equal monthly installments on the first day of each month in
advance. In addition the Company shall promptly pay or reimburse the Executive
for all out-of-pocket costs incurred by him in rendering consulting services
under this section.
9. Termination of Employment
9.1 Termination by the Company For Cause
The Company may terminate this Agreement by discharging the
Executive for cause and upon such termination shall be relieved of all further
liability hereunder. The term "for cause" shall be limited to the following
events:
(a) The Executive's conviction of any crime involving money or
other property of the company or any of its subsidiaries or
of any other crime (whether or not involving the Company or
any of its subsidiaries) that constitutes a felony in the
jurisdiction involved; or
(b) The Executive's continued, repeated, willful violations of
specific written directions of the Board or the Company's
Chief Executive Officer (or the board of any subsidiary of
the Company of which the Executive is an officer), which
directions are consistent with this Agreement and which
violations continue following the Executive's receipt of
such written directions; or
(c) The Executive's continued, repeated, willful failure to
perform his duties hereunder; provided, however, that no
discharge shall be deemed for cause under this subsection
(c) unless the Executive first receives written notice from
the Board or the Company's Chief Executive Officer (or of
the board of any subsidiary of the Company of which the
Executive is an officer) advising the Executive of the
specific acts or omissions alleged to constitute a failure
to perform his duties, and such failure continues after the
Executive shall have had a reasonable opportunity to correct
the acts or omissions so complained of.
9.2 Termination by the Company Without Cause
The Company may, subject to the next following paragraph of this
Section, terminate this Agreement by discharging the Executive without cause
(for example, because of disagreements between the Executive and the Chief
Executive Officer or the Board with respect to policy matters). In the event of
a discharge without cause under this Section, the Executive shall continue to be
compensated during the "Compensation Period" (as herein defined) with the full
base salary, annual cash bonus and other benefits provided for in this
Agreement. Moreover the Executive shall have no obligation to minimize costs to
the Company by accepting any employment offered by others and may accept or
reject such employment in his sole discretion. The obligation of the Company to
make the payments and provide the benefits called for in this Agreement during
the Compensation Period shall be subject to reduction only by payments actually
made or benefits actually furnished to the Executive for services rendered
during such Compensation Period for another employer. The term "employer" as
used in the preceding sentence shall include any business hereafter formed by
the Executive and/or in which he owns an interest. The term "Compensation
Period" shall mean (i) the 5 year period measured from the date the Executive is
discharged without cause or (ii) the period from such discharge date to December
31, 2006, whichever is shorter; provided, however, if the Executive dies prior
to the time the Compensation Period would otherwise terminate, then in such
instance the Compensation Period shall terminate upon the Executive's death and
all payments and benefits provided for in this Section shall thereupon terminate
except that the Executive's estate shall be paid a pro-rated annual cash bonus
as per the procedures set out in the last paragraph of Section 4.2.
The Company's right under this Section to discharge the Executive
without cause may be exercised by the Company only if during the three year
period immediately preceding the date of discharge (the "Measuring Period")
there has been no "Change in Ownership or Control" of the Company. If there has
been any Change in Ownership or Control during such Measuring Period, then
during the three year period following the most recent Change in Ownership or
Control the Company may discharge the Executive only (i) for cause as provided
in Section 9.1 or (ii) as a result of the Executive being totally Disabled as
provided for in Section 6.1.
A "Change in Ownership or Control" shall mean (i) a change in the
ownership of the Company's stock or (ii) a change in the ownership of a
substantial portion of the assets of the Company or (iii) a change in the
effective control of the Company, that is described in or falls within the scope
of Section 280G(b)(2)(A)(i) of the Internal Revenue Code of 1986, as amended and
in any Final or Proposed Regulations promulgated thereunder (the "Parachute
Provisions").
A separate Change in Ownership or Control shall be deemed to have
occurred with each occurrence of any change described in or falling within the
scope of the Parachute Provisions. This Agreement pertains to each and every
Change in Ownership or Control, including successive Changes in Ownership or
Control involving the same controlling person(s).
9.3 Termination by Executive
The Executive in his sole discretion may, notwithstanding any
other provision of this Agreement to the contrary, terminate this Agreement and
discharge his employment with the Company:
(a) for "Good Reason" under Section 2 of the Severance Benefit
Agreement and thereafter receive the "Termination Benefits"
provided for in Section 3 of the Severance Benefit Agreement; or
(b) under the circumstances contemplated by Section 5 of the
Severance Benefit Agreement and thereafter receive the benefits
provided for in such Section 5.
10. Confidential Information
The Executive shall not at any time (whether during the term of this
Agreement or thereafter) disclose to any person any confidential information or
trade secrets of the Company.
If any of the restrictions contained in this section or elsewhere in
this Agreement shall be deemed unenforceable by reason of the extent, duration,
or geographical scope thereof, or otherwise, then the Executive and the Company
contemplate that the appropriate court will reduce such extent, duration,
geographical scope or other provisions hereof, and enforce the restrictions set
out in this section and elsewhere in their reduced form for all purposes in the
manner contemplated hereby.
11. Nonassignability
This Agreement and the benefits hereunder are personal to the Company
and are not assignable by it; provided, however, this Agreement and the benefits
hereunder may be assigned by the Company to any person acquiring all or
substantially all of the assets of the Company or to any corporation into which
the Company may be merged or consolidated. In the event of an assignment of this
Agreement to any person acquiring all or substantially all of the assets of the
Company or to any corporation into which the Company may be merged or
consolidated, the title, responsibilities and duties assigned to the Executive
by such successor person or corporation shall be the title, responsibilities and
duties of an executive officer of such successor person or corporation.
The provisions of this Agreement shall be binding on and inure to the
benefit of the Executive, his heirs, devisees, legatees, successors, executors
and administrators.
12. Miscellaneous
12.1 Waivers
No waiver by either party of any breach or non-performance of
any provision of this Agreement shall be deemed to be a waiver of any preceding
or succeeding breach of non-performance of the same or any other provision of
this Agreement.
12.2 Notices
All notices, waivers, or other communications (herein
collectively "notices") that either party is required or permitted to give
hereunder shall be in writing and delivered as follows:
If to the Company:
Xxxxxxx & Xxxxx, Incorporated
No. 0 Xxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
If to the Executive:
Xxxxxx X. Xxxxxxxxx, Xx.
0000 Xxxx 00xx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
subject to the right of either party at any time to designate a different
location for the delivery of notices.
12.3 Survival of Provisions
The provisions set out in Sections 8, 10 and 12.4 shall survive
the termination of this Agreement as shall all other provisions hereof which
provide for or contemplate performance by either the Executive or the Company
following the termination of this Agreement.
12.4 Severance Benefit Agreement
The Company shall not take any actions or permit any omissions
which are otherwise contemplated or allowed by this Agreement if such Company
actions or omissions would result in reducing, delaying and/or denying to the
Executive any rights of or benefits payable to the Executive under the Severance
Benefit Agreement.
The Company shall not, with respect to the Executive, take any
actions (e.g. terminate the Executive's employment) or permit any omissions
which are contemplated or allowed by the Severance Benefit Agreement if such
actions or omissions (i) would be inconsistent with or contrary to the
obligations of the Company under this Agreement or (ii) would result in
reducing, delaying or denying to the Executive any rights of or benefits payable
to the Executive under this Agreement.
This Agreement and the Severance Benefit Agreement shall be
interpreted in a manner consistent with each other.
It is the position of the parties that the payments required to
be made to or for the benefit of the Executive under (i) this Agreement, (ii)
the Severance Benefit Agreement or (iii) any other agreement or arrangement
currently existing between the Company and the Executive are not subject to the
excise tax provided for in Section 4999 of the Internal Revenue Code (the
"Excise Tax").
The parties acknowledge the possibility (but do not anticipate)
that the Internal Revenue Service ("IRS") may successfully levy an Excise Tax on
payments to or for the benefit of the Executive under this Agreement, the
Severance Benefit Agreement or other agreements or arrangements which may now or
hereafter exist from time to time between the Company and the Executive
(collectively and severally "Benefit Agreements"). If and Excise Tax is
successfully levied, the Company shall pay to the Executive (at the time of such
levy or, if later, along with and at such times as any payments are made under
the Benefit Agreements) an amount (the "Gross Up Payment") which shall be
sufficient to pay in full (i) the Excise Tax as well as (ii) any income taxes
attributable to the Gross Up Payment. The parties intend that as a result of the
Gross Up Payment all amounts received and retained by or for the benefit of the
Executive under the Benefit Agreements (after the satisfaction of all income and
Excise Taxes) will equal the amount the Executive would have received and
retained (after the satisfaction of all income taxes) if (i) no Gross Up Payment
were paid and (ii) no Excise Tax had been levied on the Executive.
Any benefits provided to the Executive under this Agreement
will, unless specifically stated otherwise in this Agreement, be in addition to
and not in lieu of, any benefits that may be provided the Executive under his
Severance Benefit Agreement.
IN WITNESS WHEREOF, the Company and the Executive have signed this
Agreement as of the day and year first above written.
ATTEST: XXXXXXX & XXXXX, INCORPORATED
/s/ XXXXXX X. XXXX By: /s/ XXXXX X. XXXXXXX, XX.
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Assistant Secretary Xxxxx X. Xxxxxxx, Xx.
Chairman of the Board and
Chief Executive Officer
/s/ XXXXXX X. XXXXXXXXX, XX.
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Xxxxxx X. Xxxxxxxxx, Xx.
[LETTERHEAD OF XXXXXXX & XXXXX, INCORPORATED]
XXXXXX X. XXXXXXXXX, XX.
SENIOR VICE PRESIDENT
MERGERS, ACQUISITIONS
AND STRATEGIC PLANNING
EXHIBIT 10.3
January 1, 1993
Xx. Xxxxx X. Xxxxxxx, Xx.
Chairman of the Board and
Chief Executive Officer
Xxxxxxx & Xxxxx, Incorporated
No. 0 Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
Dear Xxxxx:
Today the Board of Directors has elected Xxx Xxxxxxx as the Company's new
General Counsel and Secretary and taken related action. This, coupled with Xxx
Xxxxxxx'x recently jointed the Company as Director of Mergers, Acquisitions and
Strategic Planning, prompts the need to modify my November 7, 1990 Employment
Agreement with the Company. Accordingly, this will confirm that Section 1,
paragraph 1, first sentence of my Employment Agreement shall henceforth read as
follows:
"The Company hereby employs the Executive as Senior Vice President,
Mergers, Acquisitions and Strategic Planning and as counsel, and the
Executive hereby accepts employment in these capacities (it being
agreed that the Company's General Counsel and Secretary shall report
to the Executive)."
As modified above, my Employment Agreement will continue in full force in
accordance with its terms.
Please confirm by signing and returning to me one original of this letter
agreement (the other original is for the Company's permanent records). Thank
you.
Sincerely,
/s/ XXXXXX X. XXXXXXXXX, XX.
Xxxxxx X. Xxxxxxxxx, Xx.
RAJj/nlt
AGREED:
XXXXXXX & XXXXX, INCORPORATED
By: /s/ XXXXX X. XXXXXXX, XX.
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Xxxxx X. Xxxxxxx, Xx.
Chairman of the Board and
Chief Executive Officer
